Evergreen Solar Announces Preliminary Results $ESLR

JA Solar (JASO) raised guidance about two weeks ago and EvergreenSolar (ESLR) is out with preliminary results last night, but the two companies still aren’t in the sameleague.

ESLR is saying that 1st quarter shipments have increases to anew company record of about 35.4MW with revenues at about $78.5 millionand an average selling price of $2.20/watt. However, manufacturingcosts remained about where they were last quarter which is disappointing for a company doing everything they can to cut costs.

Assuming the company reports official results on May 4th that are consistent with tonight’s preliminary results, they’d be reportingrevenues that are essentially flat sequentially, but about 50% greaterthan the year ago quarter. The key though for ESLR has never been about revenues, it’s been about cutting costs and it appears they didn’t doit on the manufacturing side and won’t until they get operations up andrunning in China around the middle of the year.

After their last earnings report I said “This is a company thatneeds a shakeup, probably in management. The cost cutting clearly isn’t working and if they don’t make big improvements soon I think you’ll see them bought out at fire sale prices or bankrupt within a year. TheMassachusetts company is working to move assembly operations to China to cut costs further, but will it be too little too late?” I still feelthat way and I don’t think earnings this quarter is going to changethat. ESLR is a solar laggard that has NEVER posted a profitable year.. plain and simple.

Shares of ESLR are up about 7% in after hours trading and willtry to get back above the 50 day moving average tomorrow.

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